TaxTMI 
TaxTMI 
2025 (7) TMI 2045
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....e tune of 89 days, for which a petition for condonation has been filed as under: Dates Events/ Reasons 20.08.2024 Order of CIT(A) was received in the O/o Pr. CIT2, Kol. 19.10.2024 Due date for filing of 2nd Appeal 24.09.2024 ASR is submitted to the O/o PCIT-2, Kolkata through proper channel 05.11.2024 Certificate of filing 2nd appeal was received from the O/o Pr. CIT-2, Kolkata, 23.01.2025 Necessary hardcopies of documents/ paper/ details required for filing 2nd Appeal before Hon'ble ITAT, Kolkata were collected and prepared 18.01.2025 2nd Appeal was filed It is respectfully submitted that the appeal could not be filed on or before due date due to an immense work load relating to assessment, penalties and writ petition filed by the various assessee in the Calcutta High Court against the order U/s 148A(d) and notice U/s 148, as well as collecting and arranging the required documents/files for the 2nd appeal. Therefore, it is requested to kindly condone the delay of 101 days in filing appeal before the Hon'ble ITAT, Kolkata for the sake of substantial justice." 1.2 Considering the contents of the said petition, the delay i....
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....nd bad and as such the entire reassessment proceedings are liable to be quashed and/ or set aside. V. FOR THAT the Learned CIT (Appeals) erred in upholding the validity of notice under Section 148 of the Act, even though it was issued without Document Identification Number ("DIN") in clear violation of the circular of the Central Board of Direct Taxes, being Circular No. 19/2019 dated August 14, 2019 and such purported action of the Learned CIT (Appeals) is arbitrary, unjustified, unwarranted and illegal and hence all proceedings in pursuance of such invalid notice is liable to be quashed and/ or set aside on this ground also. VI. FOR THAT the entire material in support of the purported information on the basis of which the reassessment proceedings was initiated having not been supplied to the appellant, the Learned CIT (Appeals) erred in upholding the validity of such assessment proceedings on the basis of the decision of the Hon'ble Supreme Court of India in the case of Union of India Vs. Ashish Agarwal even though the said decision was not applicable in the instant case and thus the entire proceedings in pursuance of such illegal action is liable to be quas....
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....ion of the Learned CIT (Appeals) in upholding the addition, to the extent of Rs. 27,73,218/-, under Section 69C of the Act is arbitrary, unjustified, unwarranted and illegal and hence all proceedings in pursuance thereof are liable to be quashed and/ or set aside. XII. FOR THAT the entire assessment was completed in complete disregard of the principles of natural justice as well as without dealing with the contentions of the appellant and as such the entire assessment is liable to be quashed and/ or set aside. XIII. FOR THAT, without prejudice, the addition, if at all, is to be limited to the net profit rate of the appellant and the purported addition of Rs. 27,73,218/- is arbitrary, unjustified, unwarranted and illegal. XIV. FOR THAT the addition, to the extent of Rs. 27,73,218/-, under Section 69C of the Act is liable to be deleted. XV. FOR THAT the appellant craves indulgence to add, amend, alter and/ or modify the Grounds of Appeal on or before the hearing of this appeal." 2.2 The Revenue has raised the following grounds before the ITAT: "Whether the Ld. CIT(A) has erred in law as well as in the facts by not disallowing the entire....
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....essee. Mr Venkataraman has also conceded on behalf of the Revenue that all notices issued under the new regime by invoking the six year time limit prescribed under section 149(1)(b) of the old regime will have to be dropped if the income chargeable to tax which has escaped assessment is less than Rupees fifty lakhs. .... 64. When enacting a statute, the legislature often endeavours to ensure that the provisions of one legislation do not conflict with provisions of another legislation. Interplay (supra) [between Arbitration Agreements under the Arbitration and Conciliation Act 1996 and the Indian Stamp Act 1899, 2023 INSC 1066]. The purpose of the Income-tax Act is to levy tax on income and raise revenues for the functioning of the Government. On the other hand, the purpose of TOLA is to provide relaxation of the time for completion of any actions or proceedings falling for completion within a particular period. Thus, the two enactments operate in separate and distinct fields. This Court must ensure that the provisions of the two enactments are interpreted harmoniously unless there is an irreconcilable conflict between them. ...... b. Reading TOLA....
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....sioner or Principal Commissioner or Commissioner. 75. After 1 April 2021, the new regime has specified different authorities for granting sanctions under section 151. The new regime is beneficial to the assessee because it specifies a higher level of authority for the grant of sanctions in comparison to the old regime. Therefore, in terms of Ashish Agarwal (supra), after 1 April 2021, the prior approval must be obtained from the appropriate authorities specified under section 151 of the new regime. The effect of Section 151 of the new regime is thus: (i) If income escaping assessment is less than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) no notice could be issued after the expiry of three years; and (ii) If income escaping assessment is more than Rupees fifty lakhs: (a) a reassessment notice could be issued within three years after obtaining the prior approval of the Principal Commissioner, or Principal Director or Commissioner or Director; and (b) after three years after obtaining the prior ap....
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....ct 2021, the assessing officer was required to obtain prior approval or sanction of the specified authorities at four stages: a. Section 148A(a) - to conduct any enquiry, if required, with respect to the information which suggests that the income chargeable to tax has escaped assessment; b. Section 148A(b) - to provide an opportunity of hearing to the assessee by serving upon them a show cause notice as to why a notice under section 148 should not be issued based on the information that suggests that income chargeable to tax has escaped assessment. It must be noted that this requirement has been deleted by the Finance Act 2022;33 c. Section 148A(d) - to pass an order deciding whether or not it is a fit case for issuing a notice under section 148; and d. Section 148 - to issue a reassessment notice. 80. In Ashish Agarwal (supra), this Court directed that Section 148 notices which were challenged before various High Courts "shall be deemed to have been issued under section 148-A of the Income-tax Act as substituted by the Finance Act, 2021 and construed or treated to be show-cause notices in terms of Section 148-A(b)." Further, this Court ....
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....er section 151. A notice issued without complying with the preconditions is invalid as it affects the jurisdiction of the assessing officer. Therefore, the reassessment notices issued under section 148 of the new regime, which are in pursuance of the deemed notices, ought to be issued within the time limit surviving under the Income- tax Act read with TOLA. A reassessment notice issued beyond the surviving time limit will be time-barred. G. Conclusions 114. In view of the above discussion, we conclude that: a. After 1 April 2021, the Income-tax Act has to be read along with the substituted provisions; b. TOLA will continue to apply to the Income-tax Act after 1 April 2021 if any action or proceeding specified under the substituted provisions of the Income-tax Act falls for completion between 20 March 2020 and 31 March 2021; c. Section 3(1) of TOLA overrides Section 149 of the Income-tax Act only to the extent of relaxing the time limit for issuance of a reassessment notice under section 148; d. TOLA will extend the time limit for the grant of sanction by the authority specified under section 151. The test to determine whether TO....
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..... The new regime prohibits reopening of assessments that were time-barred under the old regime. The provisions of section 149 of the new regime are as under: 149. (1) No notice under section 148 shall be issued for the relevant assessment year,- (a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b); (b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of account or other documents or evidence which reveal that the income chargeable to tax, represented in the form of- (i) an asset; (ii) expenditure in respect of a transaction or in relation to an event or occasion; or (iii) an entry or entries in the books of account, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more:] Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if a notice under section 148 or section 153A or section 153C could not have been is....